What information does Technical analysis tell you ?

[SunTrader]

A little T & A goes a long way.

Oh you said TA. Nevermind.

 

[speedo]

Since joining the forum in early '18, feel like I've seen dozu888 talk "waste of time" on every trading thread. So I wasted the last several minutes of my own time on a dozu "waste of time" search.

Come on, guy... you're sounding like a broken record.

 

[Sprout]

Hi guys,

I want to ask what information does Technical analysis give you as a trader ? I am looking to understand the meaning of technical analysis. Hence, I am NOT asking what signal does (buy or sell) TA give you and how and NOT asking which indicator means what ?

In the raw form, I want to understand what is collection of information that technical analysis provides (which then can be used for further interpretation and signal) without any links to any particular indicator or method.

So, a sample from you answer may look like:

When I do TA, it gives info such as below about the market (let us for a particular share called UL):

- there is lot of buying happening in UL
- buyers expect a higher EPS in the earnings report.

or something like that.

In asking this question I am trying to understand how fundamentals manifest in TA. What does TA actually tell you, rather than what signal to interpret from what TA is showing.

TA generates context. Context that is the market states of continuation or change.

 

[traderwald]

TA generates context. Context that is the market states of continuation or change.

Could you please show a hypothetical description / text of the context and what is the TA that generated it ?

 

[Sprout]

Could you please show a hypothetical description / text of the context and what is the TA that generated it ?

From your level of inference, it’ll sound like a foreign language.

What’s your trading time preference?

 

[traderwald]

x

From your level of inference, it’ll sound like a foreign language.

What’s your trading time preference?

It is between 2 days to 2 weeks that I prefer to trade for Futs on index trading

 

[Overnight]

have you thought about this possibility.... perhaps, if traders actually abandon everything i call waste of time, perhaps their success rate could be higher?

If traders abandon everything you call a waste of time, they would be caught in a logic loop. Because according to you, trading is a waste of time. So then they would not be traders....So how could trading then be a waste of time, if they are no longer trading because trading is a waste of time, and so they are not traders?

 

[deaddog]

TA tells you what the market is doing.

It's up to you to figure out if the probability of it continuing to do the same thing presents you with an opportunity to profit from what the market is doing.

 

[dozu888]

If traders abandon everything you call a waste of time, they would be caught in a logic loop. Because according to you, trading is a waste of time. So then they would not be traders....So how could trading then be a waste of time, if they are no longer trading because trading is a waste of time, and so they are not traders?

Terrible

 

[comagnum]

TA defines the dollar risk & profit target. It can help you pin down the apex where a big breakout is more likely to occur.

The stock gaps out of any overhead resistance to an new all time high with volume extremely larger than it's long term avg. Next step is to see if a trending move will setup with a lower risk entry - and it did.

A half mast flag developed after the first hour which setup a lower risk entry as price constricted. The flag suggested another equal sized move up was possible.

* blue boxes are the same size to show how well the half mast flag forecasts the length of the 2nd leg up. Often it forecasts the top precisely - this one was close.

* the flag is where the institutions accumulate - this level they will protect making the trade that much less risky.